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MEMC Unit to Develop $4.6 Billion of Solar Plants in Japan

Jan. 17 (Bloomberg) -- SunEdison, the solar development unit of MEMC Electronic Materials Inc., said it plans to build solar power plants in Japan over a five-year period at an initial cost of 350 billion yen ($4.6 billion).

The second-largest U.S. maker of polysilicon is in talks with local governments including Niigata and Fukuoka prefectures on project sites, Jackie Okawa, a spokeswoman for SunEdison Japan Corp., said today by phone from Osaka. Capacity will total 1 gigawatt, she said, confirming a report by the Nikkei.

Japan’s parliament passed a bill in August guaranteeing prices higher than market rates for wind, solar and geothermal energy to encourage renewable-energy development and rely less on nuclear energy following the Fukushima Dai-Ichi disaster in March. Similar legislation in Germany and Spain has spurred solar companies to install panels.

While Japan’s incentive program is due to start in July, the government hasn’t set the prices. “We can’t start building plants until rates are set, as we can’t calculate project costs,” Okawa said.

Local projects would be profitable should prices be set at 32 yen a kilowatt-hour, the Nikkei newspaper reported. Okawa declined to elaborate on prices.

Japan’s cumulative installed solar power capacity exceeded 3.6 gigawatts in 2010, and households accounted more than 80 percent of its market, according to the International Energy Agency.

To contact the reporter on this story: Chisaki Watanabe in Tokyo at cwatanabe5@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net.

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